Sahara Set To Raise $780 Million To Free Subrata Roy

DIBYANGSHU SARKAR via Getty Images

Chairman of India's Sahara Group Subrata Roy gestures as he addresses a press conference in Kolkata on November 29, 2013. An Indian regulator froze the bank accounts of two companies of the giant Sahara group in February 2013, after it failed to obey a court order to repay billions of dollars illegally collected from investors. Sahara, a household name in India and sponsor of the national cricket team, raised 240 billion rupees ($4.4 billion) in illegal bond sales to 30 million small investors between 2008 and 2011. AFP PHOTO/Dibyangshu SARKAR (Photo credit should read DIBYANGSHU SARKAR/AFP/Getty Images)

NEW DELHI -- India's embattled Sahara conglomerate is close to raising about 53 billion rupees ($780 million) by divesting assets, a lawyer for the group said, as part of its efforts to free its jailed founder Subrata Roy.

Sahara chief Roy was arrested in March 2014 after the group failed to comply with a court order to refund money raised from millions of small investors by selling them bonds later ruled to be illegal.

Sahara, a household name in India as the former main sponsor of the national cricket team, has some prized assets including New York's Plaza Hotel, the Grosvenor House in London, Sahara Star hotel in Mumbai and a stake in a Formula One racing team.

The group has been trying to raise funds since Roy's arrest, but has failed in several past bids to comply with the top court's order to return 360 billion rupees ($5.3 billion) to investors in the banned bond plan.

Sahara has previously said it had repaid 95 percent of its liability in that plan, which has not been accepted by the court.

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Gautam Awasthi, a lawyer for Sahara, said in a statement on Tuesday the group had been able to "formalise deals" with regard to three foreign properties which, when closed, would raise about 23 billion rupees ($338.39 million).

He did not name the properties, but another Sahara lawyer told Reuters the group was close to selling Grosvenor House to a "Qatari entity" and to re-mortgaging the Plaza hotel to raise funds.

Awasthi said Sahara had sought permission from the Supreme Court to sell other assets, including the Sahara Star hotel and its shareholding in the Formula One racing team, Sahara Force India, which would raise a combined 30 billion rupees.

The total of 53 billion rupees that would be raised through these deals, however, is far short of the 360 billion rupees it needs to refund investors. The Sahara lawyers on Tuesday did not say how they plan to raise the remainder.

The court was expected on Tuesday to take up a plea of the markets regulator, which is seeking redress for millions of Sahara investors in the bond plan, to appoint a receiver to auction off some of Sahara's properties to refund its investors.

Awasthi said that hearing had now been deferred until March 29 in view of Sahara's latest fund-raising proposal.